Up to 75% tax for 3 years to be decreased for ‘New growing sphere’ start-up
Kwon Dae Gyung | kwon213@ | 2018-01-08 10:48:31
75% of corporation tax or income tax will be deducted from the business start-up business for 3 years from the establishment date in order to spread the new growth industry. Besides, if a younger full-time employee is hired to solve the unemployment problem for young people, income tax or corporation tax deduction of up to 11 million won will be provided. On the other hand, real estate regulations will be significantly strengthened as multi-homed households increase their capital gains tax from April.
The Ministry of Strategy and Finance announced on January 7 that it will enter into force after the enactment of the bill for the revision of the 17 laws regarding the amendment of the tax law that passed the National Assembly last year.
First, the amendment of the Enforcement Decree of the Tax Exemption Restriction Act (Small Business Act) has decided to reduce the income tax or corporation tax by 75% for three years and 50% for the following two years. Previously, it was a 50% reduction for 5 years, but the reduction rate was increased.
Those who receive tax benefits are those classified as new growth industries such as software (SW), content, tourism, logistics, business services, and education. In the field of SW, computer programming and system integration and management, software development and supply, information service, and telecommunications are included. The contents were classified as creative and art related services, films and video and broadcasting programs, audio-visual publishing and disc recording, and broadcasting as new growth industries.
Besides, when employees, such as in-house ventures, are involved, specific criteria for applying the 50% tax reduction for 5 years are included in the Enforcement Decree. However, in order to receive the exemption, a contract must be concluded with the existing business to separate the business, and the initiator must be the controlling shareholder and the largest shareholder as the representative of the split start-up company.
It has also made plans to expand our angel investment. It has decided to apply the investment income deduction (30 ~ 100%) to the investment of medium and small-sized enterprises within seven years of the start-up that was recruited by online small-scale investment brokerage (crowd-funding). A company that has been awarded an excellent technical evaluation within three years of its foundation and a credit evaluator credit examination can also receive an angel investment income deduction.
Besides, venture capital firms have eased the requirement to deduct beneficiary certificates from investment trusts to facilitate venture capital supply to KOSDAQ firms. Until now, it has been a venture company that invests more than 50% in new venture companies. However, it lowered the standard from 50% to more than 15%.
Meanwhile, if a younger full-time employee is hired for the purpose of expanding the youth employment, it also included the amount of deduction of income tax or corporation tax of up to 11 million won. When adding one regular employee, 7,700,000 won a year (7,000,000 won in the capital area) is tax deductible, but if the target is young, the deduction will be larger. If a young person is hired as a full-time worker or a disabled person is selected as a regular worker, the city will deduct 10 million won for each additional person and 11 million won for the province.
On the other hand, the tax imposition on real estate multi-tenants is strengthened. In the case of multifamily residents, up to 60% of capital gains tax will be imposed when selling a house in 40 adjustment areas including Seoul from April. In the case of two-household households, the sale of housing in the area subject to adjustment is subject to 10% of the transfer income tax, while the households with more than 3 houses sell the housing and the transfer income tax is 20%. On the other hand, homeless people over 30 years old are not eligible for transfer income tax 50% even if they sell their ownership rights in the area subject to adjustment.
Besides, when purchasing more than USD 600 per item from overseas or withdrawing cash, the KCS will be informed in real time, and the enforcement ordinance of the Liquor Tax Act will be revised to greatly expand the market for handmade beer, making it easy for consumers to purchase them at convenience stores and shopping malls.
Sejong City=By Kwon Dae Gyung kwon213@
[ copyright ⓒ The Digitaltimes ]
The Ministry of Strategy and Finance announced on January 7 that it will enter into force after the enactment of the bill for the revision of the 17 laws regarding the amendment of the tax law that passed the National Assembly last year.
First, the amendment of the Enforcement Decree of the Tax Exemption Restriction Act (Small Business Act) has decided to reduce the income tax or corporation tax by 75% for three years and 50% for the following two years. Previously, it was a 50% reduction for 5 years, but the reduction rate was increased.
Those who receive tax benefits are those classified as new growth industries such as software (SW), content, tourism, logistics, business services, and education. In the field of SW, computer programming and system integration and management, software development and supply, information service, and telecommunications are included. The contents were classified as creative and art related services, films and video and broadcasting programs, audio-visual publishing and disc recording, and broadcasting as new growth industries.
Besides, when employees, such as in-house ventures, are involved, specific criteria for applying the 50% tax reduction for 5 years are included in the Enforcement Decree. However, in order to receive the exemption, a contract must be concluded with the existing business to separate the business, and the initiator must be the controlling shareholder and the largest shareholder as the representative of the split start-up company.
It has also made plans to expand our angel investment. It has decided to apply the investment income deduction (30 ~ 100%) to the investment of medium and small-sized enterprises within seven years of the start-up that was recruited by online small-scale investment brokerage (crowd-funding). A company that has been awarded an excellent technical evaluation within three years of its foundation and a credit evaluator credit examination can also receive an angel investment income deduction.
Besides, venture capital firms have eased the requirement to deduct beneficiary certificates from investment trusts to facilitate venture capital supply to KOSDAQ firms. Until now, it has been a venture company that invests more than 50% in new venture companies. However, it lowered the standard from 50% to more than 15%.
Meanwhile, if a younger full-time employee is hired for the purpose of expanding the youth employment, it also included the amount of deduction of income tax or corporation tax of up to 11 million won. When adding one regular employee, 7,700,000 won a year (7,000,000 won in the capital area) is tax deductible, but if the target is young, the deduction will be larger. If a young person is hired as a full-time worker or a disabled person is selected as a regular worker, the city will deduct 10 million won for each additional person and 11 million won for the province.
On the other hand, the tax imposition on real estate multi-tenants is strengthened. In the case of multifamily residents, up to 60% of capital gains tax will be imposed when selling a house in 40 adjustment areas including Seoul from April. In the case of two-household households, the sale of housing in the area subject to adjustment is subject to 10% of the transfer income tax, while the households with more than 3 houses sell the housing and the transfer income tax is 20%. On the other hand, homeless people over 30 years old are not eligible for transfer income tax 50% even if they sell their ownership rights in the area subject to adjustment.
Besides, when purchasing more than USD 600 per item from overseas or withdrawing cash, the KCS will be informed in real time, and the enforcement ordinance of the Liquor Tax Act will be revised to greatly expand the market for handmade beer, making it easy for consumers to purchase them at convenience stores and shopping malls.
Sejong City=By Kwon Dae Gyung kwon213@